Update 

In conjunction with the publication of STICKY FINGERS: Managing the Global Risk of Economic Espionage, this website will endeavor to publish timely updates of current Economic Espionage cases covered in the book.  

---

Update on the Lucent Technologies Case:

There have been several recent, interesting and, ultimately, disappointing developments..  

In the Spring of 2002, a Superseding Indictment raised the ante considerably.  The three defendants from ComTriad – Hai Lin, Kai Xu, and Yong-Qing Cheng – were then awaiting trial on 15 counts each of Economic Espionage – conspiracy to steal and possess trade secrets belonging to Lucent's PathStar software program and providing it to Datang Telecom Technology Co. of Beijing in a failed joint venture. Also, nine counts of wire fraud have been tacked on. (Click here to read more about the expanded charges). 

It turns out that by stealing the PathStar technology, not only were trade secrets from Lucent stolen, but so were trade secrets from Telenetworks, a business unit of Next Level Communications; NetPlane Systems, Inc., a wholly-owned subsidiary of Mindspeed Technologies; Hughes Software Systems; Livingston, another wholly-owned subsidiary of Lucent; and ZiaTech Corporation, a wholly-owned subsidiary of Intel Corporation.

In September 2001, the U.S. Attorney used official diplomatic channels to ask the cooperation of the Chinese government in obtaining documents relating to Datang’s relationship with ComTriad and the joint venture established in China.  Also, the U.S. Attorney requested permission from the Chinese government to take the depositions of 11 Datang employees in China.  Surprisingly, more than a year later, the Chinese government agreed.  Consequently, in early 2003, for the first time in history, U.S. government prosecutors were going to be permitted to take depositions in China in a case that was to have been prosecuted on U.S. soil, according to Assistant U.S. Attorney and lead prosecutor Scott Christie.

But Christie was overly optimistic, and in 2004 the much heralded case completely fizzled out.  

In that year, all charges against Xu and Cheng were dropped.  Lin jumped bail and slipped through the government's fingers, presumably to return to China.  

Yet one more example of why potential trade secret thieves view the Economic Espionage Act as a law with no teeth, and why American businesses more than ever need to implement their own trade secret protection programs rather than rely on the government to protect them or even help them if a theft occurs.  Simply put, businesses need to remove temptation. 

(Updated June 2006)

Economic Espionage | About Lexicon | Protecting Trade Secrets | Client Services | Education & Training
Sticky Fingers | Economic Espionage Case Updates | Speakers Bureau